Foresight Analytics Upgrades Payton Capital’s Operational Due Diligence

Press Release

Ratings Press Release IDDODD

Sydney, 6th June 2023 – Foresight Analytics Upgrades Payton Capital’s Operational Due Diligence Rating to ‘Very Strong’.

Foresight AnalyticsForesight Analytics has assigned a ‘VERY STRONG’ Manager Operational Due Diligence (ODD) Rating to Melbourne based Payton Capital Limited.

Melbourne-based Payton Capital Ltd (Payton) specialises in the provision of wholesale debt to businesses and real estate developers, and investment products for wholesale investors, SMSFs, family offices and institutional investors.

Payton was originally founded in 1966 as an accounting practice and has become a reputable funds management business with scale. Payton underwent a restructure to become an investment manager in 2010 and entered the Australian private real estate debt market. Payton manages two investment vehicles – Payton Select Investment Fund and the Payton Pooled Investment Fund.

The firm has funded over $1.5BN of loans since inception and currently has over $1.03 billion in assets under management.

Foresight Analytics’ Manager ODD Rating assesses the capacity of an asset manager to effectively undertake its defined role of managing the operational risks relating to a pool of financial or physical assets. The overall ODD Rating is underpinned by 7 risk factors – (1) Ownership and Strategy, (2) Management talent, (3) Governance, (4) Risk & Compliance, (5) Asset & Data security, (6) Systems & Technology, and (7) Financial agility.

Payton’s ‘VERY STRONG’ ranking has been driven by the firm’s track record of consistently delivering target returns, its highly experienced management team, and its continued investment to support scalability and growth in the business.

The current assessment is enhanced by Payton’s consistent investment management and financial performance since the first managed fund was launched in 2018, which in turn has allowed it to weather the COVID-19 pandemic event and more recent challenges in the construction industry. Payton has consistently delivered target returns for its investments and has experienced steady growth in assets under management (AUM) and funds under management (FUM) since it was established.

Foresight Analytics’ analyst, Rodney Lay, said “Payton enjoys a ‘VERY STRONG’ outlook in terms of opportunities for growth within the Australian CRE lending sector due to the withdrawal of the banks from the domestic CRE lending market and an increase in capital inflows. To take advantage of the opportunities for non-bank lenders, the firm has increased its resource deployment in business development, marketing, deal origination and other specialist support areas”.

The full report is available to registered users of Foresight 360 digital platform at https://www.foresight-analytics.com/f360/

Find out more about Foresight Analytics’ Manager Operational Due Diligence by visiting www.foresight-analytics.com

About Foresight Analytics’ Manager Operational Due Diligence Rating (ODD Rating)

An Operational Due Diligence Rating assesses the capacity of an operating entity, special-purpose vehicle, or asset (collectively “operating party”) to effectively undertake its defined role of managing the operational risks relating to a pool of financial or physical assets. The ability of an operating party to carry out its role, be it in a superior, adequate, or poor manner, ultimately will have a bearing on the performance of the pool of assets. The overall ODD Ratings assigned by Foresight Analytics is underpinned by 7 risk factors – (1) Ownership and Strategy, (2) Management talent, (3) Governance, (4) Risk & Compliance, (5) Asset & Data security, (6) Systems & Technology, and (7) Financial agility.

The assessment covers operational responsibilities and oversight undertaken for a pool of assets retained by the owner, or alternatively a pool of assets that underlie a debt issue or managed fund. The assessment addresses how much the operating party enhances or potentially detracts from the ability of the asset pool to pay interest and principal on a specific security as and when due, or the fund’s ability to distribute income according to the Product Disclosure Statement (PDS). It should be noted that operational risks generally exist in addition to credit, market, and liquidity risks.

Foresight Analytics Operational Due Diligence Rating (ODD Rating) Scale & Definitions

Manager ODD Rating ScaleManager ODD Rating Definitions
SuperiorA rating of ‘Superior’ reflects the superior capability of an operating party to perform its operational role and assist the issuer or fund in meeting financial obligations in a timely manner. An operating party’s superior capacity is supported by many superior and reliable operational abilities and strong financial status.
Very StrongAn assessment of ‘Very Strong’ reflects the very strong capability of an operating party to perform its operational role and assist the issuer or fund in meeting financial obligations in a timely manner. An operating party’s very strong capacity is supported by many very strong and reliable operational abilities and some superior qualities.
StrongA rating of ‘Strong’ reflects the strong capability of an operational party to perform its operational role and assist the issuer or fund in meeting financial obligations in a timely manner. An operating party’s strong capacity is supported by many strong and reliable operational abilities and some very strong qualities.
AdequateA rating of ‘Adequate’ reflects the adequate capability of an operational party to perform its operational role and assist the issuer or fund in meeting financial obligations in a timely manner. An operating party adequate capacity will support its role, but its resilience to expected operational or financial changes is limited.
WeakA rating of ‘Weak’ reflects the weak capability of an operational party to perform its operational role and assist the issuer or fund in meeting financial obligations in a timely manner. The operating party’s weak capacity displays material, operational, financial or risk management and compliance deficiencies.
Failure to PerformAssigned when a party contracted to perform an operational role has failed to meet the required standards and terms and conditions of the contract.

The full research report is available to registered users of the Foresight 360 Digital platform. The platform can be access via www.foresight-analytics.com

General Disclaimer: The material contained in this document has been prepared solely by Foresight Analytics and Ratings Pty Ltd under Australian Financial Services Licence No. 494552. The material contained in this document is for general information purposes only, and individual financial positions, objectives and circumstances have not been taken into consideration. The information contained in this material should not be acted upon without obtaining advice from a licensed investment professional.

It is neither an offer to sell nor a solicitation of any offer to purchase and /or sale of any securities in an investment product or managed investment scheme, derivative, index, or financial instrument, nor is it an advice or a recommendation to enter into any transaction. No allowance has been made for transaction costs or management fees, which would reduce investment performance. Any investment in a financial product or fund involves a degree of risk. Actual results may differ from the reported performance. It is important to note that past performance is not an indication of future performance.

Foresight Analytics and Ratings research material maybe based upon information provided by the investment manager which is known to us or which was obtained from sources that we believed to be reliable and accurate at the time of publication, but Foresight Analytics and Ratings makes this information available on an “as is” basis without a duty to update, make warranties, express or implied, regarding the accuracy of the information contained herein. Errors may exist in data acquired from third party vendors, & in coding related to statistical analyses.

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About the author / Jodie Elg

Jodie Elg – Marketing Director /- An exceptional marketing professional, Jodie holds a Bachelor’s degree in Public Relations, Advertising, and Applied Communication from RMIT University.

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